Chevron has settled its claims against James Russell DeLeon and his firm, Torvia Ltd., which funded the Lago Agrio plaintiffs’ litigation. Roger Parloff published a copy of the Settlement Agreement in a Fortune article.
The price of the settlement was not money, but rather DeLeon’s repudiation of the Lago Agrio litigation and Steven Donziger, his agreement to provide document discovery to Chevron, and his agreement to pay any proceeds of the Lago Agrio litigation to Chevron. In return, Chevron is dismissing its claims against DeLeon, Torvia, and Julian Ross Jarvis.
The settlement does not entirely dispose of the Gibraltar litigation. Chevron still has claims against another third-party funder, Woodsford Litigation Funding Ltd., and against Amazonia Recovery, Ltd., the entity that was to receive the proceeds of the Lago Agrio litigation and in which Torvia had an interest, as well as against Pablo Fajardo and others, who were directors of Amazonia.
Former LAP spokeswoman Karen Hinton tried to put a good spin on things:
In a statement, Karen Hinton, a spokesperson for Donziger, said that DeLeon had provided no funds for two years, and that Donziger’s team welcomed the settlement, “because it will allow a significant stake in the winning judgment of the affected villagers to be used for clean-up of their ancestral lands rather than be paid to an outside investor.”
Hmm… I wonder if this is right. DeLeon and Torvia haven’t given up their interest in Amazonia Recovery. They simply agreed to pay over the proceeds to Chevron. So I’m not sure why the LAPs would think that the portion of the judgment that would have gone to DeLeon and Torvia will now be divied up among the LAPs and other stakeholders. Amazonia will get its share, and then, under its governing agreements, it will (it seems to me at first glance) have to distribute that share to its beneficial owners, including DeLeon and Torvia. Perhaps I am missing something here.
This settlement may rankle a little more than some of the others, because Donziger and DeLeon were law school clasmates. Who is left as a potential turncoat? Probably Woodsford Funding will be the next shoe to drop. Aside from the true inner circle and Woodsford, I can’t at the moment think of any third parties left standing. I have no doubt that the appellate lawyers for Donziger and the LAPs, and the LAPs’ lawyers in Canada and elsewhere who are seeking to enforce the Ecuadoran judgment, weighed the risk of the wrath of Chevron before taking the case, but it seems to me unlikely that Chevron would try to go after them. On the other hand, given Chevron’s theory of the RICO enterprise and its purpose, you might ask why the appellate lawyers should not be liable—which suggests, to me anyway, the possible overreach of the RICO theory.
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